Ive been a numpty - kids savings

jonnyb

wooders wrote: »

I have been putting £20 x 2 into my 2 kids accounts monthly since they were born, the statements came today and despite me grabbing the MSE mantle with my own finances Ive noticed theyve got a measley 0.75%

Kid 1 has £2350 (£16 interest!!) :eek:
Kid 2 has £1350 (£9 interest!!) :eek:

The wife is ADAMANT the kids have this in their name ( so I cant wang it into my isa ) but we admin it. It would be in there for years with a drip feed of £20 per month but has to be available if the world came tumbling down on the family!

Can anyone help with best options, Ive noticed some accounts for kids wouldnt let me start off with the amount the have already.

hope you can help

You need to re-educate your wife, in my opinion.;) If this is all about the kids, surely getting them the best return is the most important thing. If she is concerned, maybe put it in an isa in her name ?:money:

We have a self select stocks and shares isa opened in my wife's name, and we put £100 per month into it, to be split between our 2 boys in about 16 years time, buying "safe" shares like Aviva, Vodafone and Tesco, plus auto reinvest any dividends (which are approx. 5% for each company)

JanCee

If you do opt for savings accounts don't forget to complete R85s for each child, to avoid them being taxed on the interest.

thenudeone

jonnyb wrote: »

You need to re-educate your wife, in my opinion.;) If this is all about the kids, surely getting them the best return is the most important thing. If she is concerned, maybe put it in an isa in her name ?:

It's not as clear cut as that. There are always advantages and disadvantages to every approach.

The OP's wife has a point of view which many would understand, seeing how many people post on these forums about ex-partners (and sometimes siblings and parents) not being as honest as they should be.

Other Benefits about the investment being in the child's name:
-income and growth is tax free (to a certain limit)
-it's safe from creditors (if the parent is made bankrupt)
-it doesn't count as part of parent's savings (if parents end up claiming benefits)
-it would not be counted as part of the parent's estate for IHT purposes after 7 years (sliding scale applies within 7 years)
-The process can be useful to teach kids about money, saving, and their responsibility for it.

Although admittedly it's quite difficult to find a way to buy investments (other than savings accounts) in a child's name.

Wobblydeb

Children's ISAs should be available towards the end of this year, with a limit of £3,000. They will operate similar to adults' ISA, allowing either cash savings or stocks & shares. http://www.moneyobserver.com/news/11-03-31/junior-isas-launch-november

Perhaps it would be worth keeping the money in an easy access account to see what is made available then?

kidmugsy

I suggest you keep your eyes open for the forthcoming issue of Index-Linked Savings Certificates. If the T&Cs are attractive, it might be just the spot for your bairns' bunce.

5limJim

kidmugsy wrote: »

I suggest you keep your eyes open for the forthcoming issue of Index-Linked Savings Certificates. If the T&Cs are attractive, it might be just the spot for your bairns' bunce.

any ideas when these will be released/advertised, is it a NS&I thing, is it something hthat can be in the wee childs name....

Need to start saving for the wee fella, give him a good start when he's older... or is it worth me going for ING / Northern Rock etc for now and shift his money out?

kidmugsy

Yes, it's NS&I. I'm not sure whether you just buy them for the nipper, or buy them yourself as trustee for the nipper, but no doubt either possibility would suit you. I'd guess that you'd need a different application form if you are buying as trustee - perhaps their webpage will explain.

When? Wouldn't we all like to know? "Some time this tax year" is all I know.

kidmugsy

I suggest that you visit the ns&i website and register so that they'll send you an e-mail when the new issues are available. Good luck.

Radionotme

I'm in a similar situation - been saving approx £100 a month into my son's account for a couple of years (Got £2500 in there) and the rate of interest is 0.75%

Thinking of putting it all in the 5 year account mentioned above, and then contributing my regular £100 here:
http://www.halifax.co.uk/savings/accounts/childrens-savings/childrens-regular-saver/

Any thoughts or better offers out there?